black economy

Usually untraceable, and hence untaxable, business dealings that are not reflected in a country's gross domestic product (GDP) computations. An integral part of most third-world and many first-world economies, it is a cash based system in which transaction records are kept in secretaccountbooks (called 'number two' accounts). Though it employs illegal (and even criminal) methods, it is a survival practice in repressive tax regimens or where legitimate expression of entrepreneurial activity is made unnecessarily difficult by a maze of regulations. Black economy and black money go hand in hand.